U.S. Receives New Oil Pipeline Proposal From TransCanada

A Canadian firm has reapplied for a U.S. permit to build a multibillion-dollar Canada-U.S. oil pipeline after its first proposal was rejected over environmental concerns, both sides said Friday.

The U.S. State Department said it is "committed to conducting a rigorous, transparent and thorough review" of the northern leg of the Keystone XL pipeline that would connect to an existing pipeline in Steele City, Neb.

It said the new application from TransCanada Corp. "includes proposed new routes through the state of Nebraska," where environmental groups had raised concerns about the pipeline's potential danger to a major aquifer.

Obama's political rivals had given him 60 days to make a decision on whether to approve the $7 billion, 1,700-mile pipeline route, forcing him to choose between environmentalists and industry.

The Obama administration said TransCanada could resubmit the Keystone XL project but that officials were not able to assess its plan by a Feb. 21 deadline put into law by the Republican majority in Congress.

In announcing its new application for the link from the Canadian border with the U.S. state of Montana to Nebraska, TransCanada said it "maintains its commitment to build Keystone XL as safely and reliably as possible."

It said it will adopt U.S. federal regulatory conditions, including "a higher number of remotely controlled shut-off valves, increased pipeline inspections and pipe that is buried deeper in the ground."

The State Department said it will now hire "an independent third-party contractor to assist" it in determining whether granting a permit for the proposal would meet the U.S. national interest.

Put in the balance are "energy security, health, environmental, cultural, economic, and foreign policy concerns," it said in a statement from Calgary, Alberta.

"Previously when we announced review of alternate routes through Nebraska this past fall, our best estimate on when we would complete the national interest determination was the first quarter of 2013," it said.

Russ Girling, TransCanada's president and chief executive officer, said the pipeline will reduce U.S. "dependence on foreign oil and support job growth by putting thousands of Americans to work," according to a company statement.

"Keystone XL will transport U.S. crude oil from the very large Bakken supply basin in Montana and North Dakota, along with Canadian oil, to U.S. refineries," Girling said.